Withdrawal Rates: Will Assets Last?
The following three tables, based on a 20-, 25-, and 30-year period, show the chances of whether or not a stock/bond portfolio will last an investor until death. The 2009 study by BlackRock shows inflation-adjusted withdrawal rates ranging from 1-10% per year and stock/bond allocations ranging from 20-100%.
20-Year Period [stock/bond allocations]
|
|
20/80 |
40/60 |
60/40 |
80/20 |
100/0 |
|
1%* |
100% |
100% |
100% |
100% |
100% |
|
2%* |
100% |
100% |
100% |
100% |
100% |
|
3%* |
100% |
100% |
100% |
100% |
99% |
|
4%* |
99% |
100% |
98% |
97% |
94% |
|
5%* |
93% |
94% |
91% |
88% |
85% |
|
6%* |
65% |
74% |
74% |
73% |
73% |
|
7%* |
31% |
43% |
50% |
55% |
57% |
|
8%* |
10% |
21% |
32% |
38% |
42% |
|
9%* |
3% |
8% |
17% |
26% |
32% |
|
10%* |
1% |
3% |
8% |
15% |
23% |
*inflation-adjusted annual withdrawal rate (% of portfolio)
25-Year Period [stock/bond allocations]
|
|
20/80 |
40/60 |
60/40 |
80/20 |
100/0 |
|
1%* |
100% |
100% |
100% |
100% |
100% |
|
2%* |
100% |
100% |
100% |
100% |
99% |
|
3%* |
100% |
100% |
99% |
98% |
96% |
|
4%* |
94% |
95% |
94% |
90% |
86% |
|
5%* |
68% |
75% |
77% |
75% |
73% |
|
6%* |
33% |
46% |
54% |
57% |
59% |
|
7%* |
10% |
22% |
31% |
40% |
44% |
|
8%* |
3% |
7% |
16% |
23% |
33% |
|
9%* |
0% |
3% |
7% |
13% |
23% |
|
10%* |
0% |
1% |
4% |
8% |
16% |
*inflation-adjusted annual withdrawal rate (% of portfolio)
30-Year Period [stock/bond allocations]
|
|
20/80 |
40/60 |
60/40 |
80/20 |
100/0 |
|
1%* |
100% |
100% |
100% |
100% |
100% |
|
2%* |
100% |
100% |
100% |
100% |
99% |
|
3%* |
98% |
98% |
98% |
95% |
94% |
|
4%* |
83% |
87% |
87% |
84% |
82% |
|
5%* |
46% |
58% |
63% |
64% |
66% |
|
6%* |
15% |
29% |
40% |
45% |
51% |
|
7%* |
4% |
11% |
22% |
29% |
37% |
|
8%* |
1% |
4% |
10% |
18% |
27% |
|
9%* |
0% |
1% |
4% |
11% |
16% |
|
10%* |
0% |
0% |
2% |
6% |
11% |
*inflation-adjusted annual withdrawal rate (% of portfolio)